Articles Tagged With: FHA Loans

March 21, 2017

FHA Home Loans and Zoning: A Reader Question

How are FHA home loans affected by zoning laws? A reader asked a question about this in our comments section recently: “I have a family who wants to purchase a home on commercial zoned property. The County has given a letter stating that they would allow the rebuilding of the residence as long as less than 75% was damaged in a disaster. The lenders are refusing to allow an FHA residential loan for the property. It is clearly residential use in commercial zoning. Whey would they refuse to abide by the rules you state?” This question is in reference to a 2011 blog post titled, “Can I Get An FHA Loan For A Commercial Property?” The FHA loan rules quoted in that post have since been superseded in their entirety | more...

March 17, 2017

FHA Condo Loans: A Reader Question

By Joe Wallace

A reader asks a question in our comments section this week about FHA condo loans. “My husbands ex-wife failed to pay their condo dues and they foreclosed on the property (Not the bank.. the Condo Association). The property was deeded to a 3rd party by the court. The FHA Loan is still in my husbands name with no rights to the title.” “The property is being used as a rental and the bank will not ‘make’ them refinance the loan. They currently have been 2 months behind and continue to mark up his credit. No one seems to care Thoughts? Anything in the FHA Guidelines that addresses this?” Borrowers who find themselves in legal entanglements associated with FHA home loans or FHA condo loans should seek legal counsel. The advice | more...

March 15, 2017

Chapter 13 Bankruptcy: A Reader Question

By Joe Wallace

A reader got in touch recently about issues related to Chapter 13 bankruptcy and FHA mortgage loans. “I made all payments for 6 years on my chapter 13 and they said I have to wait 2 more years to be approved when my credit score is over 730. I dont get it I paid my dues and still have to wait.” The primary confusion here is associated with the FHA loan rules in HUD 4000.1 regarding “seasoning” periods that are required in the wake of certain types of negative credit events such as a bankruptcy. The rules vary depending on the type of bankruptcy you have filed, but in the case of this reader question, let’s examine what FHA loan rules have to say about Chapter 13 bankruptcy: “A Chapter | more...

How much can I borrow with an FHA refinance loan?

March 14, 2017

Mortgage Markets and FHA Loans

By Joe Wallace

At the beginning of 2017, Forbes.com published a housing outlook for 2017 which included predictions from experts about what could happen this year. Three months into the new year, how accurate were some of the highlights of this piece? How do current trends affect mortgage loan applicants and those looking to refinance? A quick look at current events shows that some of the observations made at Forbes.com in an article by Samantha Sharf are absolutely right and there’s no reason to expect anything different in the short to mid-term. Consider the prediction made in this piece about mortgage rates. According to the article: “By historic standards rates are still low. In 2017 experts expect movement, but differ on where for the 30-year fixed rate will land. Estimates out there range | more...

March 14, 2017

Mortgage Loan Interest Rates Surging Higher Ahead of Fed

By Joe Wallace

Since our last report, mortgage rates have pushed significantly higher. Industry professionals are watching the Fed very carefully at the moment as it’s expected that the Fed will hike interest rates soon. Any indication of that hike, the timing of the hike, or its’ severity is sure to send investors scrambling in one direction or the other. A hike in rates is a sign that the Fed has more confidence in the economy, but as we’ve mentioned here before, what is good for the economy is often bad news for mortgage loan interest rates. We are likely to see markets react in anticipation or out of a certain set of expectations rather than the actual reality of the situation. This sort of thing has happened before, when the Fed began | more...

March 13, 2017

FHA Refinance Loans: Cash-Out, Rehab

By Joe Wallace

Are you thinking about refinancing into an FHA loan from an existing non-FHA mortgage? Do you already have an FHA mortgage and want to refinance? There are options under the FHA loan program for both, including the possibility of applying for a refinance loan to repair the property or add improvements to it. FHA refinance loans are intended for all financially qualified borrowers regardless of their current loan, whether it is an existing FHA, conventional, VA, or other non-FHA mortgage. FHA refinance loan options include cash-out, no cash-out, rehab mortgages, and streamline refinancing. FHA Streamline Refinance loans are intended for those with existing FHA mortgages and have no FHA-required appraisal or credit check. The lender may require both, but the FHA loan rules in HUD 4000.1 allow participating lenders to | more...

March 13, 2017

FHA Loans and Septic Distances

By Joe Wallace

What are the FHA loan guidelines for septic tank issues? A reader asked us a question in this area in the comments section recently: “I am in contract to buy a home with a FHA 203 rehab loan. Today I had building and septic inspections and I found the septic was actually located on the neighbors property. The neighbor doesnt care and is very willing to work with me on it. Does this disqualify the loan?” There are several factors at work for FHA loan approval, not just FHA loan minimum standards. State law, building code, health department requirements and other regulations may affect whether corrections are required as a condition of loan approval. So it’s very important to understand that FHA loan rules may be silent in areas where | more...

March 9, 2017

FHA Mortgage Questions And Answers

By Joe Wallace

There are many questions about FHA loans-those who are new to the process want to know some very basic, but very important things including how down payments are calculated, who is eligible for an FHA loan, and whether the borrower is free to sell the home purchased with an FHA mortgage after buying it, and how soon. Let’s explore some of these questions: Am I Eligible For An FHA Loan? The implication with a question like this sometimes includes another question. “Do I make too much money to qualify?” This is due to a misconception that FHA mortgages are intended only for first-time buyers, the economically disadvantaged, or those who have earnings that fall within a certain range. But the truth is, FHA mortgage loans have no income limits and | more...

March 8, 2017

Mortgage Rate Trends: Edging Higher

By Joe Wallace

Since our last report, mortgage rates had one day of mild recovery, but yesterday rates took an upward turn. Many industry professionals are keen on next week’s Fed meeting as a potential make-or-break in terms of short-term rate trends. Will the Fed hike interest rates? What will the investor reaction to that news be if it comes to pass? These are the questions on the minds of those watching mortgage loan interest rate trends at the moment. And until next Wednesday, all anyone can do is wait and watch. At the time of this writing, 30-year fixed rate conventional mortgages are reported at a best-execution 4.25%, borrowers have likely noticed recent rate changes reflected in closing costs rather than an actual rate change. FHA mortgages are holding in their range | more...

March 7, 2017

Buying A Home From A Family Member

By Bruce Reichstein

Is there a penalty of some kind for purchasing a home from a relative when using an FHA mortgage? A reader asked a question about that recently in our comments section. “I would like to purchase my father-in-laws home. He passed away 2 1/2 years ago. His estate was left to my brother-in-law and my two daughters since I was divorced from his son many years ago and he passed away 17 years ago.” “We have been keeping up and the utilities have been in service since then and we have been keeping the house up cleaning and painting it. The house appraised $109K. My question is: for me to purchase the house through FHA do I have to have been living in the house for a year and the | more...